TEHRAN - The first tender for Iran’s new oil and gas contract model, known as IPC, will be held by the mid October, Ali Kardor, the managing director of National Iranian Oil Company (NIOC), announced in a press conference on Tuesday.

According to Kardor, South Azadegan oilfield will be the priority for the first tender and the tender for mid and small oil fields may be held for domestic companies earlier than the mentioned date.

South Azadegan is one of the five oilfields, dubbed the West Karoun oilfields, Iran shares with Iraq at the western part of Iran’s southwestern region of Karoun. 

The official also mentioned that the general framework of the IPC has been approved by the cabinet on Monday and some amendments have been applied.

He noted that based on the latest amendments, oilfields with a recovery factor less than 20 percent are top priority and a copy of the finalized IPC will also be sent to the National Security Council for approval.

“The duration has not been changed and it is still 20 years,” he added.

Further in his remarks Kardor noted that NIOC will start notifying foreign companies and will send invitation letters for the tender next week.

In November 2015, Iran introduced a new model of oil and gas contracts, known as Iran Petroleum Contract (IPC), which will replace buy-back agreements. It is expected to offer more flexible terms on oil price fluctuations and investment risks to make the sector more financially attractive.  

‘Technology transfer stressed in IPC’

Asked about technology transfer, the official said that in the new contracts NIOC has placed a significant importance upon transferring new technologies to the country. “We have focused on technology transfer in three different layers namely upstream, engineering, procurement and construction (EPC) and equipment,” he added.

 ‘$134b needed for upstream projects by 2021’

According to Kardor, NIOC needs $134 billion of investment for upstream oil and gas projects by 2021 to meet the objectives of the country’s Sixth National Development Plan (2016-2021) and with the new contract model it would be possible to reach this figure even sooner.

Signing new contracts, it is estimated that about $10 billion of foreign investment will be attracted by the end of current Iranian calendar year.

Earlier this week Gholamreza Manouchehri, the deputy managing director of NIOC for development and engineering affairs, said that Iran will sign two or three deals based on the new model of oil contracts, known as IPC, by the end of the current Iranian calendar year (March 20, 2017).

‘Pre-sanctions level reachable by Mar. 2017’

Answering a question by the Tehran Times about Iran’s current production level, and the production perspective for the future, the official said that the country will reach the pre-sanctions level of 4 million barrels per day by the end of the current Iranian calendar year (which ends on March 20, 2017) and reaching 5.2 million bpd is on the agenda.

Elsewhere in the press conference, asked about Algeria meeting and Iran’s position, then NIC official didn’t comment on the subject.

EF/MA